Financial Sector (Collection of Data) (reporting standard) determination No. 24 of 2021

Reporting Standard RRS 710.0 ABS/RBA Audit Requirements for Registered Financial Corporations – EFS collection

Financial Sector (Collection of Data) Act 2001

I, Alison Bliss, delegate of APRA, under paragraph 13(1)(a) of the Financial Sector (Collection of Data) Act 2001 (the Act) and subsection 33(3) of the Acts Interpretation Act 1901:

(a)          revoke Financial Sector (Collection of Data) (reporting standard) determination No. 22 of 2019, including Reporting Standard RRS 710.0 ABS/RBA Audit Requirements for Registered Financial Corporations - EFS collection made under that Determination; and

(b)          determine Reporting Standard RRS 710.0 ABS/RBA Audit Requirements for Registered Financial Corporations - EFS collection, in the form set out in the Schedule, which applies to the financial sector entities to the extent provided in paragraph 2 of the reporting standard.

Under section 15 of the Act, I declare that the reporting standard shall begin to apply to those financial sector entities, and the revoked reporting standard shall cease to apply, on 1 July 2021.

This instrument commences on 1 July 2021.

Dated: 16 June 2021

[Signed]

Alison Bliss

General Manager

Data Analytics & Insights Division

Interpretation

In this Determination:

APRA means the Australian Prudential Regulation Authority.

financial sector entity has the meaning given by section 5 of the Act.

Schedule

Reporting Standard RRS 710.0 ABS/RBA Audit Requirements for Registered Financial Corporations – EFS collection comprises the document commencing on the following page.

Reporting Standard RRS 710.0

ABS/RBA Audit requirements for Registered Financial Corporations – EFS collection

Authority

1. This Reporting Standard is made under section 13 of the Financial Sector (Collection of Data) Act 2001.

Application

2.             This Reporting Standard applies to registered financial corporations (RFCs) required to report under the EFS collection.

3.             RFCs to which this Reporting Standard applies must comply with this Reporting Standard in its entirety (unless expressly indicated otherwise).

4.             This Reporting Standard commences on 1 July 2021.

Obligations of an RFC – auditor appointment

5.             An RFC must annually appoint an auditor (Auditor) for the purposes of this Reporting Standard.

6.             An RFC must ensure that the terms of engagement between the RFC and the Auditor include:

(a)          the Auditor’s roles and responsibilities specified in this Reporting Standard; and

(b)          a requirement that the Auditor, in preparing a report under this Reporting Standard, must have regard to relevant Standards and Guidance issued by the Auditing and Assurance Board (AUASB), to the extent that those Standards and Guidance are not inconsistent with the requirements of this Reporting Standard.

7.             An RFC must use all reasonable endeavours to ensure the Auditor complies with the terms of engagement contained in paragraph 6.

8.             An RFC must ensure that the Auditor has access to all data, information, reports and staff of the RFC that the Auditor reasonably requires to fulfil their role and responsibilities in relation to the EFS collection. This includes access to the RFC Board and internal auditors as required by the Auditor.

9.             An RFC must ensure that the Auditor is fully informed of all reporting requirements applicable to the RFC. In addition, the RFC must ensure that the Auditor is provided with any other information APRA has provided to the RFC that may assist the Auditor in fulfilling their role and responsibilities in relation to the EFS collection.

Obligations of an RFC – audit report

10.         An RFC must submit to APRA the reports referred to in paragraph 15 in relation to the matters set out in paragraph 16. They must be submitted on or before the day specified in paragraph 15.

11.         An RFC, if requested by APRA, must within a reasonable time provide APRA with the terms of engagement, other instructions or correspondence, including management letters, which may have a bearing on the:

(a)          scope or conduct of work undertaken by the Auditor, or,

(b)          report form, content, or coverage including findings or opinions provided by the Auditor,

in accordance with this Reporting Standard.

12.         An RFC must ensure that the following are provided to its Board:

(a)          reports provided by the Auditor in accordance with this Reporting Standard, and any associated assessments and other material prepared in connection with fulfilling the requirements of this Reporting Standard;

(b)          commentary or responses provided to the RFC by APRA (including responses provided by APRA on behalf of the agencies) on reports provided by the Auditor, and any associated assessments and other material; and

(c)          any commentary or response given by the RFC on the Auditor’s reports, associated assessments and other material given by the RFC to APRA.

13.         An RFC must ensure that, upon request by APRA in writing, the Auditor provides working papers and other documentation to APRA.

Internal audit

14.         An RFC must ensure that the scope of internal audit includes a review of the policies, processes and controls put in place by management for compliance with the EFS reporting standards.

Responsibilities of the Auditor

15.         An RFC must ensure that the Auditor provides reports to the RFC’s Board on the matters referred to in paragraph 16 within four months after the RFC’s financial year end. 

16.         An RFC must ensure that the reports prepared by the Auditor provide:

(a)          Reasonable assurance or limited assurance in accordance with paragraph 17 on the information required under:

(i)            Reporting Standard ARS 720.0 ABS/RBA Statement of Financial Position;

(ii)         Reporting Standard ARS 720.1 ABS/RBA Loans and Leases; and

(iii)       Reporting Standard ARS 720.2 ABS/RBA Deposits.

(b)          Limited assurance that the RFC’s systems, processes and internal controls:

(i)            are designed to ensure that the RFC has complied with all applicable reporting requirements under the EFS collection;

(ii)         are designed to ensure the RFC has provided reliable data to APRA as required under the EFS collection; and

(iii)       have operated effectively for the purposes of subparagraphs (b)(i) and (b)(ii) above throughout the RFC’s financial year.

17.         An RFC must ensure that the Auditor, when reporting in accordance with paragraph 16:

(a)          for data sourced only from accounting records – provides reasonable assurance that the information in these collections, as at the RFC’s financial year end, is reliable and in accordance with the relevant reporting standards.

(b)          for data sourced only from non-accounting records – provides limited assurance that the information in these collections, as at the RFC’s financial year end, is reliable and in accordance with the relevant reporting standards;

(c)          for data sourced from a combination of accounting records and non-accounting records – provides reasonable assurance that information sourced from accounting records, and limited assurance that information sourced from non-accounting records, as at the RFC’s financial year end, is reliable and in accordance with the relevant reporting standards.

18.         For the purposes of this Reporting Standard, reasonable assurance and limited assurance are defined in accordance with the Framework for Assurance Engagements issued by the AUASB, and accounting records is defined in accordance with the AUASB Glossary, both of which are issued under section 227B of the Australian Securities and Investments Commission Act 2001.

19.         An RFC must ensure that the Auditor, in preparing reports in accordance with paragraph 16:

(a)          does so on the basis that the agencies may rely on the report; and

(b)          exercises independent judgement and does not place sole reliance on the work performed by APRA.

20.         An RFC must ensure that the Auditor retains all working papers and other documentation in relation to the requirements set out in paragraph 16, for a period of seven years from the date of the report to which the working papers or documentation relate.

Other responsibilities of an RFC

21.         The costs of preparing and submitting reports, documents and other material required by this Reporting Standard must be borne by the RFC.

22.         An RFC must ensure that persons involved in the provision of information for the purposes of the EFS Collection (including the Auditor and officers and employees of the RFC) should note that it is an offence under subsections 137.1 and 137.2 of the Criminal Code Act 1995 to provide, whether directly or indirectly, false and misleading information to a Commonwealth entity, such as APRA.

23.         Liaison with the Auditor will normally be conducted under tripartite arrangements involving APRA and the agencies, the RFC and the Auditor. Notwithstanding the tripartite relationship, APRA (and/or one or more of the agencies), and the Auditor may meet, at any time, on a bilateral basis at the request of either party.

Interpretation

24.         Terms that are defined in Reporting Standard ARS 701.0 ABS/RBA Definitions for the EFS Collection (ARS 701.0) or in this Reporting Standard appear in bold italic.

25.         In this Reporting Standard:

agencies means the ABS and the RBA.

AUASB means the Australian Auditing and Assurance Standards Board.

26.         Unless the contrary intention appears, any reference to an Act, Prudential Standard, Reporting Standard, Australian Accounting or Auditing Standard is a reference to the instrument as in force or existing from time to time.